Jarecki Manufacturing Co. v. Dailey

Mr. Presiding Justice Brown delivered the opinion of the court. There are various technical objections raised by the appellee to our consideration of this appeal on the record which has come to us, of which objections it is not necessary to say more than that they are not well taken. The substantial questions in the case are properly before us, we think, for decision. But in the view we take of it, it is only necessary to discuss one. The appellant’s whole case is based on the position that John Dailey had no authority to endorse for Dailey Bros, the draft which is involved and which is- described in the statement prefixed to this opinion. It does not matter, therefore, what ultimate decision of the appeal we might arrive at were we convinced of the correctness of this premise of the appellant’s argument. Without g'oing further into it, we may place our decision on our want of such conviction. The burden of sustaining the traverse of the garnishee’s answer was undoubtedly on the plaintiff. The garnishee expressly denied having in its hands any assets of the .defendants or being indebted to them. This denial entitled it to the discharge given to it by the judgment unless overcome by proof. Under no theory could the answer detailed in the prefixed statement to the interrogatory concerning the collection of a check payable to the Dailey Bros, be held to charge the garnishee unless it was supplemented by proof that this piece of negotiable paper endorsed “Dailey Bros.” and collected, as the answer discloses, for and as the property of the Studebaker Bank, was at the time of collection the actual property of the defendants. The plaintiff’s theory is that it has furnished that proof by the testimony of Fenton, district manager of the plaintiff company, that Samuel and Homer Dailey composed the firm of Dailey Bros., supplemented by an answer in the deposition of Catherine F. Dailey, stepmother of the defendants, to the same effect and a further answer that it was John Dailey who endorsed the check. But, leaving out of account that it is a very doubtful proposition, considering the presumptions concerning signatures necessary to the negotiation of commercial paper, whether, if the non-membership of John Dailey in the firm of Dailey Bros, was to be taken as proved, this would furnish even sufficient prima facie evidence of the endorsement being without authority, we do not agree with the plaintiff’s contention that the non-membership of John Dailey was proved. Fen-ton declared that his knowledge was derived from Samuel and Homer Dailey’s statement to him. That was pure hearsay, only admissible against Samuel and Homer Dailey, as an admission against their interest, not as self-serving testimony in their favor. (Rush v. Thompson, 112 Ind. 158.) But the attaching creditor, who is suing Samuel and Homer Dailey alone, is pursuing the garnishee in their right. His interest in this draft is their interest, not one adverse to them. The interest of the garnishee and of the interpleader, on the other hand, comes from John Dailey’s action and is in privity with his interest. The testimony of Fen-ton, therefore, is clearly inadmissible and worthless as against the garnishee to prove John Dailey not a member of the firm. Mrs. Dailey’s testimony to the same effect is rendered futile by the fact that in the same deposition she retracts it. "When asked, “Who gave him (John) the authority to endorse the name of ‘Dailey Bros.?’ ” she answered: “He is one of the Dailey Brothers you know.” The inquiry then proceeded: “Q. He was not a member of the firm of Dailey Bros. ? A. I could not tell you that part of it. Q. You have said he was not. A. I don’t know whether all four of them were in it. All four of them are Dailey Brothers.” Fenton’s and Mrs. Dailey’s testimony is all the evidence relied on by the plaintiff to show that John Dailey was not a member of the firm of Dailey Bros. On the other hand, the record shows that there were four brothers named Dailey connected with the transactions out of which this controversy sprung. They were the sons of Michael F. Dailey, deceased. Their names were Samuel, Homer, John and Charles. The witness Perlman of the Jareeki Manufacturing Company says: “The Daileys were contractors of big oil wells,” and it appears that the widow of Michael F. Dailey was also interested in oil wells. The original debt in question here was for things needed in the construction of an oil well. One of the witnesses called by the plaintiff, an officer of a bank doing business with the family, in answer to the question, “Do you know who composed the firm of Dailey Bros.?” answered, “I don’t know to a certainty—sons of Michael Dailey. ” The widow of Michael F. Dailey, through whose negotiations the draft came to the garnishee ultimately, had an account with the bank dating back to her marriage with the father of these four sons, and, as already noted, was herself interested in oil wells, and seems at times to have acted as treasurer for the boys ’ business, although as to the draft involved here, the most definite evidence there is about it shows that she was a holder for value. At all events the positive evidence is that the Studebaker Bank was such a holder. The plaintiff’s manager, going to the Dailey farm, as he says, to investigate the truth of Samuel’s taking the check and leaving the neighborhood; talked about the matter with John and Charles, as well as Homer, and says that John spoke about the injury that Sam had done “them” in getting a check for a well which he was to send “them” and “skipping” with it and leaving “them” in the lurch; and it was John apparently who in the same conversation at which all the brothers except Samuel were present, said that it was their intention as soon as they received the check to take it to the plaintiff’s office and pay the claim. There seems as much competent evidence showing that John was a member of the firm as that Homer was. The yard foreman for the plaintiff company says that Samuel alone ordered the goods that were delivered by that company.- It appearing under this state of the evidence that John endorsed the draft “Dailey Bros.,” and that so endorsed it came into the hands of a purchaser for value, we think that the plaintiff was very far from sustaining the burden cast upon it by any theory on which it could hold the garnishee, to show that the endorsement was a forgery or without authority. We are somewhat at a loss to know why the first judgment, which seems to us correct in dismissing the interplea after discharging the garnishee, should have been vacated and one substituted which adjudicated costs in its favor but gave no other relief to the inter-pleader. In a case like this, where the property attached is alleged to be an indebtedness to be reached by garnishment, and the garnishee answers that it owes nothing to the defendants, the finding of the issues in its favor seems to us to leave nothing to be done to the interpleader’s petition but to deny or dismiss it. The twelfth assignment of error questions the rightfulness of this judgment for costs. Although it is not specifically argued, we must hold it well assigned. So far as the judgment of the Municipal Court gives costs to the Studebaker Bank against the plaintiff it is reversed; in all other respects it is affirmed. Reversed in part and affirmed in part.